Advertisers get piece of local news shows

While just about every television genre has jumped on the lucrative branded entertainment bandwagon, news programs generally have been considered off-limits to product integration to preserve editorial integrity.

But with TV stations facing increased competition and pressure on advertising revenue, the barriers that shielded news programming from production integration and placement deals are falling. Product placement, media and branded entertainment agencies say they are increasingly being pitched opportunities from local stations to integrate their clients' products into news programming in exchange for media buys or integration fees.

"There are more local news stations that are incorporating brands into news in innovative, cutting-edge ways," said Aaron Gordon, president of entertainment marketing firm Set Resources Inc. "The line, which has always been black and white in terms of what's news and what's commercials, is now being blurred." Media agency Initiative said it has been working on integrating advertising content into local news on behalf of several of its clients.

A number of local stations, including Young Broadcasting's indie KRON-TV San Francisco and Univision O&O KMEX-TV Los Angeles, confirmed that they have integrated advertisers into their newscasts and are actively seeking out product-integration deals. Meredith Broadcasting's Fox affiliate KPTV-TV Portland, Ore., launched a new lifestyle show in January called "More Good Day Oregon" as an extension of its morning news program "Good Day Oregon" that airs weekly segments designed to serve as vehicles for brand integration.

Such other stations as CBS Corp.'s indie KCAL-TV Los Angeles and Gannett's NBC affiliates in Denver, Minneapolis, Atlanta and Cleveland are experimenting with integration into newsmagazine-type shows that they describe as entertainment rather than news.

"We're all trying to find ways of integrating commercial messages into content that satisfy the audience and advertisers without hurting our product," KRON president and general manager Mark Antonitis said. "When you're an independent, you've got to do what you can to survive. You bank on your credibility as a news organization every day, but you also have to be successful as a business. You have to be creative for your advertisers without compromising the credibility of your news organization."

Most stations are focusing their efforts on morning news shows, where lifestyle segments allow for more integration opportunities without sounding as many alarm bells with viewers as it might if product integration popped up in the hard-news portions of their newscasts. At present, full-fledged brand integration into news programming appears to be limited to local news, but some marketing experts suspect that the network morning news shows won't be far behind.

"We are already seeing an erosion of the 'editorial wall' in network newsrooms, particularly for morning news and newsmagazines," said Jim Johnston, partner at the law firm Davis & Gilbert, which represents both media agencies and entertainment clients.

"I think you'll find that this type of activity will continue to take place, and other forms of product integration will find their way into news divisions as well," he said. "The news organizations will continue to seek a balance between editorial independence and advertiser interests, but you will likely see a lot more boundary-pushing in the future."

Representatives for ABC's "Good Morning America," NBC's "Today" and CBS' "The Early Show," all produced through their respective networks' news divisions, say they allow no product integration of any kind. But they do feature the brand names and logos of the sponsors of their concert series on the stages where their musical acts perform. They also run billboards announcing the sponsors of their various news segments.

Just last month, "Good Morning America" broadcast segments of the show live from a Norwegian Cruise Line ship as part of a weeklong series called "Girls' Week Out." According to "GMA" spokeswoman Bridgette Maney, Norwegian Cruise Lines did not pay integration fees for the segments, hosted by correspondent Mike Barz and co-anchor Diane Sawyer, but did foot the bill for airfare, room and board to send nearly 300 women -- contest winners and their girlfriends -- on a cruise to Honduras, Jamaica and the Grand Cayman Islands. Most of the segments broadcast from the ship focused on the women who won the cruise by writing in to say why they deserved time away with their girlfriends, she said.

Radio-Television News Directors Assn. president Barbara Cochran warned that integrating advertisers into news programming could backfire, costing local stations viewers instead of having the intended effect of increasing ad sales. "You're selling the credibility of the news, and if viewers start thinking your news is for sale, then the credibility of your news is lost and your audience is lost," she said.

According to RTNDA's ethics guidelines, "news reporting and decision-making should be free of inappropriate commercial influences" and "should not show favoritism to advertisers," and "news organizations should protect the integrity of coverage against any potential conflict of interest."

Univision's KMEX has an ongoing integration partnership with health-care provider Kaiser Permanente Southern California as part of what the station calls its "Lead a healthy life, get the facts" public-service campaign. Kaiser physicians are interviewed on myriad health topics on Univision's various news programs, news footage is shot at Kaiser facilities, and Kaiser patients and support groups are featured in news segments. As part of the arrangement, Kaiser pays additional fees for the integrations, which are not disclosed as such during the news programs.

"Bringing Kaiser on board was a win-win for both of us because they get the exposure of their physicians on television and we have their experts giving us the medical view on a particular health issue and providing vital information to our audience," a Univision spokeswoman said. "Typically news isn't for sale because you need to maintain your integrity. However, you also need to be creative to find ways to include your advertisers without damaging your credibility."

She said KMEX also has involved some of its news personalities in on-air integration/promotion deals with other advertisers, including a major automaker. Last month, KRON aired an 11-day "Spa Spectacular" series in which 11 local spas were featured in the last half-hour of its five-hour morning news programs and viewers were offered the opportunity to purchase half-price gift certificates for spa services.

According to Antonitis, one of the station's news anchors announced that the spas were paying to be featured on the program during the segments.

"I want it to be absolutely clear that that's what's going on here," Antonitis said. "If it's in the newscast, it has to be clearly identified either by an anchor, an announcement or even both that these people paid to be part of this segment or are providing products in exchange for the segment."

In another KRON integration that aired this month, Tourism Australia -- the government body responsible for international and domestic tourism marketing for Australia -- paid KRON to run a weeklong series featuring stories about the country in its morning news program. In addition to an integration fee, Tourism Australia bought traditional spots in the KRON newscasts, paid all expenses for a five-member news crew to travel to Australia and sponsored trips to Australia for two winners of an e-mail contest promoted on-air.

"They certainly had input into our stories, but anytime we do anything with an advertiser that involves news, we have ultimate editorial control," Antonitis said. In this case, Tourism Australia's pay-for-play role was disclosed in the end credits.

"We bring on people all the time to talk about books, products and interesting new ideas anyway," Antonitis said of KRON's decision to integrate advertisers into its news programming. "So if we can have the added benefit of a new revenue source and give something to our viewers that they wouldn't be able to get otherwise and advertisers get their products advertised, it's a win-win-win."

In Portland, KPTV maintains that its new "More Good Day Oregon" program allows for product integration because it is a lifestyle magazine show rather than a traditional newscast.

"It's a high-energy, fast-paced, newscast-style program that has lifestyle content, not news content," KPTV news director Patrick McCreery said. "I think it's an important distinction that our news segments are not for sale, which is why we're endeavoring to create a new product where integration is possible."

Since premiering Jan. 9, "More Good Day Oregon" already has integrated a major local shopping center for a segment on last-minute gifts for Valentine's Day and a local spa for a two-part series featuring the spa's services and a makeover giveaway won by a viewer. In both cases, the advertisers' involvement was disclosed in the end credits.

"It's proving to be a fairly popular way to work with advertisers here in Portland," McCreery said. "I think it's going to catch on. Gone are the days of just selling spots in local shows. You have to move beyond that if you want to take it to the next level."

Indie KCAL in Los Angeles said that its "9 on the Town" nightly program, covering hot spots and entertainment in Los Angeles and produced by Icon Entertainment, accepted payments from advertisers to be featured in the program, which is expected to go off the air this month after a year-and-a-half run. A KCAL spokesman said the financial relationship is disclosed in the end credits just as it would be in "The Apprentice" or any other show doing integration deals with advertisers. Lisa Joyner, KCBS-TV and KCAL's lifestyles and entertainment features reporter, was one of the hosts of "9 on the Town."

Despite their willingness to strike integration deals with advertisers, the local stations all insisted that the exchange of airtime in their news broadcasts for additional ad revenue would not jeopardize their editorial integrity.

"What you can't do for any advertiser is put into question the integrity of your news product, and the best way to do that is to be absolutely clear about what you're doing," KRON's Antonitis said. "As someone with a journalism background, I don't have any concern about integrating products as long as it's done properly, appropriately and consistently. That's why we have very hard-and-fast rules about identifying advertisers who pay to play."

Advertisers also have found more subtle ways to integrate themselves into local news content, like getting their brand logos displayed in crawls at the bottom of the screen during newscasts. Sue Johenning, executive vp and director of local broadcast for Initiative, said the media agency has worked out such deals for Carl's Jr. with Fox O&O KTTV-TV Los Angeles and KNBC-TV Los Angeles.

"It's a nonintrusive way for stations to be able to integrate clients' logos in a way that seems to appeal to the news departments," she said. Advertisers also pay to have their logos displayed on news and weather helicopters featured during newscasts.

For those advertisers who want to forgo the expense and restrictions of dealing directly with station ad sales and news departments, there are also a number of back doors into local news shows. According to product-placement agencies, there are news production companies that strike their own integration deals with advertisers without informing the dozens of local news stations around the country that pick up their segments.

"These production companies have called me and pitched me on the idea of how they do product placement within news stories," said Jeff Greenfield, executive vp at entertainment marketing firm 1st Approach.

There also are industry experts paid by advertisers to talk about their brands on both local and national news programs. Despite news reports last year about experts who had failed to disclose financial relationships with the brands they pitched on network morning news shows and assurances from the networks that they were either tightening or reviewing their policies to prevent any recurrences, marketing experts say they are certain the practice is continuing.

"This type of thing is happening to a greater extent than people realize," attorney Johnston said.